West Midlands councils have failed to display leadership and are not working together effectively to halt declining bus passenger numbers, financial watchdogs have warned.

The Audit Commission urged local authorities to develop a range of "integrated and sustained actions" to reverse years of decline in bus use across the region.

In a letter to passenger transport authority CentroPTA, District Auditor John Gregory said there was no chance of Government targets to increase passenger figures being met. Instead, a significant decline which saw an 11 per cent fall in passengers between 2000 and 2005 was likely to continue.

Mr Gregory accepted there was no "magic bullet" guaranteed to convince more people to travel by bus and he accepted that Centro and the region's councils were now taking a more constructive approach to working together.

However, there was still no comprehensive agreement about the way forward between the various partners involved in delivering bus services across the West Midlands.

The Audit Commission's comments follow private concern at Centro about transportation policy in Birmingham, where Conservative city council leaders are seen as anti-bus.

Tory cabinet transportation member Len Gregory has been criticised for failing to take a decision about the long-term future of the A38 Tyburn Road bus lanes, which have been suspended since the autumn of 2004.

Mr Gregory identified three areas where he believed past performance had been poor:

* Partnerships - the collective resources of Centro, the councils and bus operators have not been used to full effect to improve bus use;

* Leadership - the multiple organisations involved in transportation made the provision of authoritative and visible leadership difficult. There has been a failure to provide consistent and effective leadership;

* Performance management - procedures for target setting, monitoring and taking effective remedial action are not sufficiently robust. The central issue of why schemes designed to increase bus use are not having the predicted impact has not been regularly or rigorously addressed.

Mr Gregory added: "Positive results have been achieved, such as the Safer Travel Police Team and Network West Midlands, but there is an acknowledgement that more could have been achieved and that much more needs to be achieved if the challenging target is to be reached.

"There are clear aims and strategies for the improve-ment of bus services in the West Midlands. However, their effectiveness is limited by a lack of shared under-standing by the key agencies involved in their delivery.

"Crucially, the bus strategy and the targets are not owned by the bus operators."

Centro-PTA will spend £7.3 million on subsidising bus services in 2008/09 and £2.6 million on Bus Partnership Initiatives designed to increase patronage on seven designated major bus routes.

The BPI investment will also pay for 89 screens at bus stops displaying information about estimated bus arrival times.

A Centro-PTA report to leaders of the West Midlands councils underlined the importance of bus services, which are described as having a key role in supporting the "viability and vitality" of the region.

The report added: "In order to maintain existing patronage levels and attract new passengers there needs to be ongoing and significant improvements in service provision."